19th Mar 2018


Is China picking off individual EU members?

  • Investments in Hungary have failed to materialise (Photo: dolmansaxlil)

Lately EU integration seems to have become a wrestling match between those member states large enough to impose conditionality on their partners and those member states large enough to escape this interference. No wonder small and peripheral members are feeling trampled upon.

They can be forgiven for looking for a less onerous form of co-operation. In particular, those member states obliged to accept the harsh conditions attached to the EU’'s financial support seem to be looking to the east, waiting expectantly for a dollop of investment as well as preferential credits.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

In so doing, they are ignoring accusations that China's interest in engaging with individual EU members is not the selfless behavior of a power with too much cash on its hands, but that China is looking to disrupt the progress of EU integration and the consolidation of a rival power.

Concerns in Brussels focus particularly on Hungary.

Budapest is angry at the EU's criticism of its constitutional and financial reforms - reforms it claims to be carrying out in pursuit of German-style institutional discipline – and it is peeved by the European Commission's apparent double standards as regards the consolidation of Hungarian finances.

That the center-right Fidesz government should pick up where its left-wing predecessor left off in pursuing close and friendly relations with Communist China is surprising.

It was, after all a young democratic activist named Victor Orban, the Fidesz Prime Minister, who in 1989 organised a public protest in Budapest against the Tiananmen Square massacre.

During Orban's first term as Prime Minister, in 1998-2002, the two countries did admittedly sign a common declaration on friendly relations.

But in the same year, the Hungarian consulate in Shanghai was closed, and Orban held a meeting with the Dalai Lama. This distinctly unfriendly behavior was typical of the dissident roots of many centre-right movements in central Europe.

Lack of cash can have a remarkably liberating effect when it comes to political principles, however.

Two months after his landslide victory in the 2010 elections, the newly re-elected Orban ended loan-extension talks with the International Monetary Fund (IMF) and the EU. Orban, who had effectively deprived himself of funds from the West, looked to China to provide a short cut to economic recovery.

His logic was impeccable: in the period 2004-2010, previous Hungarian governments had reaped the economic benefits of good relations with China.

And yet, Orban's gamble has not played out as he expected. Despite praising Chinese leaders for their "loyalty to a few principles, which we here in the West have turned our backs on in recent times," he has not received much in return.

According to unofficial Chinese statistics, the last two years have seen China invest around $2-2.5 billion in Hungary. But half of it ($1,25 billion) came from just one company - Wanhua Industrial Group - which in February 2011 acquired full control of chemical producer BorsodChem.

Twice Chinese leaders promised to provide Hungary with a loan for development projects, and twice the money has failed to materialise.

Beijing has also refused to join major Hungarian infrastructure projects as well as turning down the opportunity to help the airline Malev, bankrupted in the wake of an EU competition law case.

The reason for this coolness? Orban's confrontational policy towards Western organizations coupled with his distrust of markets. The Chinese deputy minister of foreign affairs, Song Tao, who paid a visit to Budapest in April 2012, has said as much.

He stated in public and in front of Orban that it is always preferable to have a partner who is predictable and stable.

In short, the pattern of China's relations with Hungary suggests Beijing is not in fact interested in becoming an alternative pole of attraction for needy and dissident EU states.

It is precisely a member state's sound finances and commitment to regional integration that make it attractive, or not, to China.

In the Chinese strategy towards the EU, of which only the contours are yet clear, central Europe looks set to play a significant role.

According to Wen Jiabao, the region will become a "Chinese gateway." And, following the restart of negotiations with the IMF, Hungary may soon become a more predictable and attractive partner.

Tellingly though, it was not Hungary but Poland, a country much more committed to regional intergation than to biateralism with China, with whom the Middle Kingdom in January 2012 signed an agreement on "strategic partership."

Dariusz Kalan is central Europe analyst at the Polish Institute of International Affairs (Pism) in Warsaw

China urges Germany and France to solve euro-crisis

Chinese Prime Minister Wen Jiabao on Thursday offered vague promises to buy bonds from troubled euro-countries, but said that it is ultimately up to Germany and France to solve the crisis.

MEPs and China mark change in relationship

Members of the five big political groups in the European Parliament have met with members of the one big political group in the National People's Congress of China, in what has been described as a “changing” and "very friendly" climate.

Evacuated women from Libya arrive newly-pregnant

Niger has temporarily stopped all evacuations from Libya detention centres under an EU funded programme because so few are being resettled to Europe. Many of those that have been evacuated are pregnant, with some asking for HIV testing.

News in Brief

  1. Sweden emerges as possible US-North Korean summit host
  2. Google accused of paying academics backing its policies
  3. New interior minister: 'Islam doesn't belong to Germany'
  4. Hamburg 'dieselgate' driver wins case to get new VW car
  5. Slovak deputy PM asked to form new government
  6. US, Germany, France condemn 'assault on UK sovereignty'
  7. MEPs accept Amsterdam as seat for EU medicines agency
  8. Auditors: EU farm 'simplification' made subsidies more complex

Stakeholders' Highlights

  1. Counter BalanceConmtroversial Turkish Azerbaijani Gas Pipeline Gets Major EU Loan
  2. World VisionSyria’s Children ‘At Risk of Never Fully Recovering', New Study Finds
  3. Macedonian Human Rights MovementMeets with US Congress Member to Denounce Anti-Macedonian Name Negotiations
  4. Martens CentreEuropean Defence Union: Time to Aim High?
  5. UNESDAWatch UNESDA’s President Toast Its 60th Anniversary Year
  6. AJC Transatlantic InstituteAJC Condemns MEP Ana Gomes’s Anti-Semitic Remark, Calls for Disciplinary Action
  7. EPSUEU Commissioners Deny 9.8 Million Workers Legal Minimum Standards on Information Rights
  8. ACCAAppropriate Risk Management is Crucial for Effective Strategic Leadership
  9. EPSUWill the Circular Economy be an Economy With no Workers?
  10. European Jewish CongressThe 2018 European Medal of Tolerance Goes to Prince Albert II of Monaco
  11. FiscalNoteGlobal Policy Trends: What to Watch in 2018
  12. Human Rights and Democracy NetworkPromoting Human Rights and Democracy in the Next Eu Multiannual Financial Framework

Latest News

  1. Brexit and trade will top This WEEK
  2. Dutch MPs in plan to shut EU website on Russian propaganda
  3. Four years on – but we will not forget illegally-occupied Crimea
  4. Evacuated women from Libya arrive newly-pregnant
  5. Merkel in Paris for eurozone reform talks
  6. Commission rejects ombudsman criticism over Barroso case
  7. Western allies back UK amid Russian media blitz
  8. Meet the European Parliament's twittersphere

Stakeholders' Highlights

  1. Mission of China to the EUDigital Cooperation a Priority for China-EU Relations
  2. ECTACompetition must prevail in the quest for telecoms investment
  3. European Friends of ArmeniaTaking Stock of 30 Years of EU Policy on the Nagorno-Karabakh Conflict: How Can the EU Contribute to Peace?
  4. ILGA EuropeCongratulations Finland!
  5. EUobserverNow Hiring! Sales Associate With 2+ Years Experience
  6. EUobserverNow Hiring! Finance Officer With Accounting Degree or Experience
  7. UNICEFCyclone Season Looms Over 720,000 Rohingya Children in Myanmar & Bangladesh
  8. European Gaming & Betting AssociationEU Court: EU Commission Correct to Issue Guidelines for Online Gambling Services
  9. Mission of China to the EUChina Hopes for More Exchanges With Nordic, Baltic Countries
  10. Macedonian Human Rights MovementCondemns Facebook for Actively Promoting Anti-Macedonian Racism
  11. Nordic Council of MinistersGlobal Seed Vault: Gene Banks Gather to Celebrate 1 Million Seed Collections
  12. CECEIndustry Stakeholders Are Ready to Take the Lead in Digital Construction